20X3 $ 150,000 30,000 19,000 11,000 Stacey Williams, owner of the Williams Caf, has requested your assistance in preparing a three-year cash budget. She provides the following financial data: 20X1 20X2 $ $ (20,000) -0- Budgeted pretax income 30,000 30,000 Depreciation expense Mortgage payments: Interest expense 20,000 19,500 Principal reduction 10,000 10,500 Expected changes in current accounts: Accounts receivable 5,000 5,000 Inventory 2,000 (3,000) Accounts payable 5,000 (6,000) Other planned activity: Sale of capital stock 100,000 -0- Purchase of property 20,000 50,000 -0 Additional Information: (5,000) 2,000 7,000 o 1. Cash at the beginning of 20X1 was $30,000. 2. The average tax rate of the Williams Caf is 25 percent. 3. Assume operating losses can be carried forward for up to five years and offset against operating profits prior to calculating income taxes. 4. Assume dividends are paid out during profitable years. The amount of dividends paid Cash Management 583 is equal to 50 percent of net income. Required: Prepare a cash budget for the years 20X1-20X3 for the Williams Caf using the adjusted net income approach